BHEL strategises to take on Chinese competition

Power plant equipment manufacturer, Bharat Heavy Electricals Limited, is facing the Chinese heat. It lost a couple of orders recently as the latter outbid it by quoting prices lower by 20-30 per cent, said RN Mishra, executive director, BHEL, Trichy.

"While in India we are contemplating additional capacity for power plant equipment in the range of a few thousand Mw, the Chinese already have an installed capacity of over 100,000 Mw," he added.

Though the PSU is in a comfortable position with orders worth 35,000 Mw just six months into the Eleventh plan, it has devised strategies to counter the increasing competition.

"We are confident of bagging at least 17,000 Mw more in the thermal segment," he said. Of the total 78,600 Mw generation capacity proposed in the Eleventh Plan, 59,000 Mw will be thermal and gas-based.

In the on-going five year period, the heavy engineering major is set to execute orders worth 42,000 Mw at the rate of 8,000 Mw per annum.

For this, BHEL is already in the process of expanding its manufacturing capacity by spending Rs 1,000 crore and has asked its sub-contractors too to go for capacity addition to match its capability.

Addressing the 'Sub-Contractor's Meet 2007' here, Mishra also asked the 300-odd sub-contractors to consider ways of cycle time reduction and cost control measures.

On its part, BHEL would also introduce a system which will help sub-contractors procure the requisite raw materials themselves than getting them from BHEL. This would contain the cost of production and enhance the delivery schedule. He also called for frequent interactive sessions between the contractors and vendors.